The
P&C Global Gold and Natural Resources Fund fell by
5.0% in January, the first decline after nine months of
consecutive advances. We out-performed the FTSE Gold Mines
index (this was down 12.5%), due to the large - 37% -
bullion position. We increased our lead over the FTSE
Gold Mines index since inception (see 'performance' below),
but our benchmark is most assuredly USD cash, not an index.
However, the sector is volatile and whilst our investment
advisers do their utmost to dampen volatility through
holding precious metals and cash, investors must expect
occasional air-pockets.
As
at 31/1/04 the Fund remained invested in a diversified
portfolio of major, medium-sized and junior gold and
mining company shares active in North America, Australasia,
Africa, Russia and other countries, as well as a large
physical position in the metals themselves (22% silver
+ 11% gold + 4% palladium = 37% of the Fund).
In
January we added to the Harmony and Goldfields positions
as the Fund's investment advisers feel that under performing
South African counters may return to favour in 2004.
We also participated in a special warrants issue in
European Goldfields, which has acquired a 30% interest
in Hellas Gold in Greece. Gold (c$400) fell by 4% on
long liquidation and silver rose by as much to $6.23
as the USD rallied from being oversold. We remind investors
that our first unlisted (pre IPO) stock, African Minerals,
is due to list in the first quarter 2004 in North America.
The Fund's directors continue to value it at book cost
$8.
The
Japanese Finance Minister has spoken of making changes
to Japan's reserves, including gold. Japan, with only
1.5% of its reserves in gold, could consume 2 years
of mine supply if it moved this to 10% (the world central
bank average). The 2004 themes are playing out as per
last month's report: greater volatility in mining shares
(fairly valued relative to the physical), a catch-up
by South African mining shares, a run in silver (with
$10/oz) possible) and a continuation of the corporate
de-hedging trend. We maintain our confidence in the
investment case for gold and, in particular, the physical
precious metals sector, where the Fund has the flexibility
to have a large weighting.
| Asset
Allocation (as at 31/1/04) |
Top
10 Holdings (63% of fund) |
| Gold
and resource shares: 63% |
1.
Silver Bullion 21% |
| |
2.
Gold Bullion 11% |
| Silver,
gold, palladium: 37% |
3.
Goldfields 6% |
| |
4.
Palladium Bullion 4% |
| Cash
0% |
5.
Ivanhoe 4% |
| |
6.
Resolute Mining 4% |
| |
7.
African Minerals 4% (pre IPO subsc) |
| |
8.
Anglogold 4% |
| |
9.
Harmony Gold 3% |
| |
10.
Coeur d'Alene 2% |
| Asset
Allocation (per month) |
 |
| Performance
in USD (for initial investors) |
| Since
inception (20/2/03): |
| |
20/2/03
|
31/1/04
|
%
ch
|
| P&C
Global Gold Fund (Gross NAV) |
1000
|
1705.06
|
+71%
|
| Value
of $1,000 invested (after fees) |
1000
|
1609.60
|
+61%
|
| |
|
|
|
| FTSE
Gold Mines Index |
1240
|
1596.15
|
+29%
|
| Gold
bullion |
352
|
400
|
+14%
|
| Silver
bullion |
4.65
|
6.23
|
+34%
|
| |
|
|
|
| Note:
Past performance does not guarantee future results.
All prices and comparative numbers are unaudited
and for indication purposes only. |
| Track
Record |
| Percentage
monthly performance after performance fees (net) |
 |
| Percentage
monthly performance after performance fees (net) |
| 2003 |
| Jan |
Feb
|
Mar
|
Apr
|
May
|
Jun
|
Jul
|
Aug
|
Sep
|
Oct
|
Nov
|
Dec |
| n/a |
-2.17
|
-1.47 |
3.14 |
7.97 |
1.81 |
8.76 |
17.2 |
4.06 |
6.82 |
6.52 |
3.08 |
| 2004 |
| Jan |
Feb
|
Mar
|
Apr
|
May
|
Jun
|
Jul
|
Aug
|
Sep
|
Oct
|
Nov
|
Dec |
| -5.04 |
|
|
|
|
|
|
|
|
|
|
|
|
